Norway to lift grid tariffs and halve discounts for big consumers by 2021

The grid operator is changing its tariff models in order to pay for investments in Norway’s distribution network, which needs to be reinforced in part due to the move from fossil fuels to renewable power in the Nordic region, Statnett said

OSLO: Norway’s Statnett will lift electricity grid tariffs by nine percent in 2019 and halve the discounts granted to its most power-intensive consumers within three years, it said in a statement on Monday.

The grid operator is changing its tariff models in order to pay for investments in Norway’s distribution network, which needs to be reinforced in part due to the move from fossil fuels to renewable power in the Nordic region, it said.

The 9 percent tariff hike will mean an increase of 0.6 oere per kilowatt hour (kWh) for average consumers.

The country’s largest electricity users, which can currently claim a discount on tariffs of up to 90 percent, will see that cut by 15 percentage points each year until 2021.

The move will increase costs for Norway’s largest power consumers, such as aluminium maker Norsk Hydro and fertilizer producer Yara, and also for large data centres, which the country is trying to attract.

“The reason we are making these changes is that the difference between the customers with the highest discount and other customers would otherwise have increased significantly,” Statnett’s executive vice president Knut Hundhammer said.

In 2018, Statnett’s investments in reinforcing its grid are expected to reach about 12.5 billion crowns ($1.54 billion), with a further 30 to 40 billion crowns planned over the next five years, the grid operator said last week.

Source: reuters